‘Footnote group’ belittled AG
Posted on November 5th, 2016

By Niranjala Ariyawansha Courtesy Ceylon Today

Chairman of the Committee on Public Enterprises (COPE) Sunil Handunnetti says the UNP MPs on COPE belittled the Auditor General during the investigation. “I cannot understand why the government is trying to save a couple of persons at the cost of sacrificing the Auditor General and COPE unity in the process.”

?: Are you satisfied with the COPE report on the Central Bank Bond scam?
A: Yes. I am highly satisfied. It was a successful exercise getting all MPs on COPE to agree to the recommendations despite issues militating against it in the context of pros and cons in Parliament. That was the success of the report. Although there is a division of sorts, all have agreed to the recommendations.

?: The statement you were to make on Friday tabling the COPE report was blocked. What were you planning on saying?
A: We have exposed a massive fraud in the COPE report. They tried to hide the tree in the jungle. It cannot be done. The UNP MPs belittled the Auditor General during the investigation. I cannot understand why the government is trying to save a couple of persons at the cost of sacrificing the Auditor General and the integrity of COPE. It has now been proved that they were instrumental in burdening the country with yet another massive financial loss and earned big money for themselves at the nation’s expense.

In a scenario within which the Auditor General is being denigrated, the COPE will not be able to investigate the workings of any of the public enterprises after this. They could always keep on saying that the AG and they too have opinions which differ from conclusions made by a COPE probe.
By adopting this stance and bringing pressure to bear on the AG they are in effect challenging Parliament’s sovereignty in the sphere of fiscal control. It is the creation of a very wrong precedent.

?: Can the Auditor General be challenged like this?
A: That is what I say. I despise the very thought of influencing him in any way or insulting him. All these facets are included in the Chairman’s message in the report.

The names of the persons who insulted him, and later apologized, are mentioned in it.
The Auditor General’s task is to express an independent opinion on the performance of State enterprises when called upon to do so. We may not agree with his independent opinion. But we cannot challenge it. He expresses an opinion based on a thorough study. That can be changed via a similar study. We can express our dissent in Parliament.

I am perplexed about the fact that there has not been any individual or organization that has come out in protest against this shabby treatment of the AG.

On the other hand, the Audit Commission has not been given powers. It is defunct.
Can we guarantee that the replacement for Gamini Wijesinghe, if he is removed, will not be a puppet of the government?

?: Whats your opinion about the severe criticism of the media by some Ministers after the COPE report was published?
A: What they are in effect saying is this : “Don’t investigate our corruption. If you do, we will punish you”. In the context of the fact that there is this deep national concern about corruption everywhere, certain media organizations did the nation a great service by giving priority to publicity about the Bond Scam probe process. The threat to media that we saw in Parliament was the expression of that fear of exposure”
On the other hand, there was no need for MP Sujeewa Senasinghe to say that the media must be summoned by COPE. I have said this often. He sees the media as a threat. I in fact want the media invited to COPE proceedings. They must see the proceedings.

?: Why was the COPE report on the Central Bank Bond issue so controversial?

A: This is not an ordinary report. The previous reports were not so much controversial. I submitted reports on the Ceylon Electricity Board, Ceylon Petroleum Corporation, Sri Lanka Cricket etc. I even summoned the Speaker of Parliament to appear before COPE. They were not problems. This time we focused on the Central Bank which must maintain credibility as the authority vested with the authority to exercise functions on fiscal control in the entire country. While we were reporting the losses caused by the scam, another group said that the bond issue process was in order. They argued that the former Governor of the Central Bank was right. I and many others were of the firm opinion that the Bond issue process as well as the former Governor’s conduct in the whole affair were wrong and the attempt to shield them was also wrong and would encourage other serious offences. People then began seeing the conflicting differences between these two stances and opinions.

?: Why were you challenged so much?

A: We studied the evidence, documents, data and notes for 18 months before we submitted the report on the Central Bank Bond issue. I cannot compile a report without including the facts discovered in the process of our probe. I cannot include my personal opinions in it. But the other group wanted the facts discovered in the process of our probe to be omitted from the report and instead to include conclusions drawn only from chosen evidence. They tried to say that the bond market operated in that manner and no one could predict it. On that basis they said the opinion of the Attorney General was based on a flimsy rationale.

They tried to argue that auctioning was the ordinary method of purchasing bonds since 2006. They tried to argue that the direct replacement system which was used since 2008 was the alternate method. The opposing group entered footnotes in the report stating that they would agree to the recommendations but insisted that their own conclusions be stated separately.

?: Has former Governor Arjuna Mahendran said under questioning that Prime Minister Ranil Wickremesinghe had instructed him to be present at the Bond auctions ?

A: Yes. But, when has the Monetary Board approved his instructions? The existing procedure governing Bond issues is a hybrid of direct placement and auctioning. On 27 February 2015, the primary dealers were not aware that a Rs 10 billion Bond Issue was on the cards. They did not know that the existing procedure had been completely changed. However, one of the primary dealers knew that there would be an auction. He, Arjuna Aloysius, knew that one billion rupees would be called and Rs 20 billion would be taken. Therefore, only he bid for 75% and as a result the interest increased.

?: How did this information leak?

A: The Footnote Group who opposed our view tried to point out that the information was leaked. My question is how did the fact that the Central Bank would go for a 100% auction leak? How does another person know something hitherto only known by the Central Bank Governor?
The COPE report describes the conduct of the Central Bank Governor on 27 February 2015 . In normal practice a Governor does not come to the front office. But Mahendran came there on that day and the Footnote Group argues that it was a coincidence. He visited the front office at 10.45 a.m. and 12.45 p.m. When he says to the officials of the tender committee to make a Rs 10 billion offer, isn’t it influencing? The Superintendent of the Credit Management Department notes that ‘ the Governor instructed us to go for a Rs 10 billion issue.’ This is the naked truth.

?: Why do you call the UNP MPs in COPE the Footnote Group?
A: COPE has 26 members and 16 agreed to the report. That is the actual report. There are nine others who agreed to the report but with footnotes stipulating conditions. These UNP MPs try to dilute the essence of the report. Our problem is in trying to understand why they totally agree to the recommendations yet object to the content of the report?

?: Earlier reports said that your team and the Footnote Group will submit two reports?
A: You have to ask them. I must say that we have not made any compromise to persuade them to totally agree to the recommendations. We did not change our stance.

The recommendations in the report tabled in Parliament on Friday are the same submitted to the COPE on 21st. We withdrew one recommendation because of MP Sumanthiran citing a point of law. Not a single recommendation came from the Footnote Group.
However, only one report can be submitted by COPE according to Parliamentary tradition. Opposing views can be annexed to that report. We had a problem about the manner of annexation. In fact, there must be two reports because there are two clear opinions. One is for protecting thieves and the other is for exposing them. But finally the Footnote Group had to agree to all of our recommendations.

?: Why did you walk out of the COPE meeting?
A: The basis of my report is the Auditor General’s report submitted in June on the issue of Bonds by the Central Bank. COPE agreed to conduct the investigation based on his report. We worked on that agreement. The Central Bank officials were called again and again on that basis. Therefore, eventually no one can blame us for basing our probe and on the Auditor General’s report because we had agreed to do so. The Auditor General has pointed out the lack of professional care due on the part of the Central Bank Governor to ensure that there is minimum cost and minimum risk.

If the Auditor General changes his opinion, will the COPE report lose its legitimacy? That is why I cannot agree to the stance of the Footnote Group that contends that the Auditor General’s opinion is politicized. The 10th article of the report explains the reasons for my walkout. It was a decision based on clear rationale.

?: Did you walk out due to unbearable pressure from the Footnote Group?

A: I am a politburo member of the JVP. We are used to absorbing pressure in all sorts of circumstances. We fought against the dictator Rajapaksa. I don’t take any notice of personal insults. One of my old friends said that he would shave his head if I tabled the COPE report on Friday. I am waiting for him with a pair of scissors.
The Footnote Group accused me in a very serious manner of having drawn up a report that was biased against Mahendran.
When the Footnote Group wanted to frame charges against Arjun Aloysius, I opposed it. They accused me of having taken money from Aloysius and walked out of the meeting to protect him. But the truth has emerged today.

?: There was an allegation that you were not strong enough to hold the position of COPE Chairman?
A: I have proved my strength. There have been more popular COPE Chairmen who preceded me in office. I have been serving on COPE for a long time. I am the only one who has enjoyed COPE membership for 16 years. I have an English medium degree from the Sri Jayewardenepura University in Business Management. I am qualified but they think we in the JVP are not qualified.

?: Why did you meet the UNP MPs of COPE separately?

A: It was a full COPE meeting. We studied the draft of the COPE report on 20th. We met on 21st too. Eight MPs said they would agree to the report. UNP MPs said they wanted to discuss further. I must give them that opportunity although I have a personal opinion. That is my duty and responsibility. They could do it in Sirikotha or in Arjuna Mahendran’s house. But I compiled the draft. They must get any clarification from me. I must make way for that.

?: Why did the MPs of the UNP try to protect the former Governor of the Central Bank so much?
A: Because they did not want the truth described in this report to be made public.

They cannot challenge it. There is only one truth and not several truths.

?: Do you think the UNP group was influenced by someone?
A: I cannot comment on this as Chairman of COPE. I don’t know. They have the right to their opinions. But we won the struggle after all and it is a valuable victory for Parliamentary authority in financial control and democracy.

?: The Central Bank is under the Prime Ministers Ministry of Economic Affairs and Policy Planning. But, according to the Central Bank Act, the Monetary Board of the Central Bank must be represented by the Secretary to the Ministry of Finance. How do you see this contradiction?
A: Yes. Although the Central Bank comes under the Ministry of Economic and Policy Planning, the Secretary to the said Ministry is not on the Monetary Board of the Central Bank. We have mentioned this problem in the report.

?: Will Parliament pave the way for the implementation of law?

A: They must do so and they must monitor the implementation . They are the duties of COPE. You are raising the need of bringing the results of implementing law back to COPE.

?: In a nutshell what do you think about the COPE process in the Central Bank Bond Scam?

A: The responsibility lies with Parliament after this. We tried to deliver justice to the people through this exercise. As the JVP we have fought outside Parliament and now we have proved our calibre to act in the Parliament putting to good use our knowledge and skills.

?: Are you speaking as the Chairman of COPE or as a JVP MP?
A: How can there be a difference?

One Response to “‘Footnote group’ belittled AG”

  1. plumblossom Says:

    Yes, Ranil Wickramasinghe must resign immediately. This is the honourable thing to do. The country should be run by a PM who holds the confidence of most people. This is very important. Someone else who holds the confidence of the people should be appointed the PM by President Sirisena. Besides, Arjunan Mahendran did say the PM, meaning Ranil, asked him to do it. Therefore he should resign immediately which is the honourable thing to do and let any investigations take place without any interference. In other countries, this is what happens after this type of incident. So it is not at all unique.

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